Mandating Failure

The recent decision by U.S. District Court Judge Henry Hudson striking down the “individual mandate” component of the Patient Protection and Affordable Care Act poses an interesting question regarding access to affordable health care in America which has generally gone overlooked: do we even want everyone to be covered under health insurance?

In a segment for ABC’s show 20/20, John Stossel exposes some of the lesser known costs incurred by consumers and health care providers as a result of health insurance.

Insurance is effective when it protects patients from unforeseeable, catastrophic illness or injury. It’s a voluntary pooling of wealth against the risk of such events occurring. It isn’t designed to pay for predictable, and often unneeded, day-to-day care. Unfortunately, the latter has over time become the paradigm regarding health insurance, and this taking for granted of mundane care has caused an unnecessary increase in the demand for said care, which in turn has been increasing its price well beyond the rate of inflation.

Given what we know now, what could be the result of a law mandating the purchase of health insurance? We can most likely expect people to demand more health care. After all, insurance allows them to get it virtually “for free.” This will either intensify the trend of growing health care costs, create shortages, or both. It would also likely lead to higher insurance premiums, deductibles and co-payments.

The example of LASIK also brings up an important point. Obviously, it’s not feasible to shop around for the cheapest emergency/urgent care when you’ve had a heart attack or accidentally chopped off your finger, and insurance is necessary as a safety net for procedures dealing with those and similarly immediate problems. But what if insurance paid for only those procedures, and nothing else–what if we paid out of our own pockets for every other thing? Consumers would no longer be insulated from the true cost of their care. They’d shop around for the best deals, and hold health care providers accountable for their own costs as well. If nothing else, it would create more incentive for people to engage in healthy living and preventative care.